MEES Update for Commercial Landlords

The rules on energy efficiency for commercial buildings are set to change. The Government's latest proposals would require privately rented buildings over 1,000 m² to achieve an EPC B rating from 2031, while smaller buildings would remain subject to the current EPC E standard.

The proposals follow Government consultations on higher MEES requirements in 2019 and 2021 and an interim response published in June 2026. They are not yet law and will require legislation before they come into force, but landlords of larger properties can now start planning for the likely changes.

Current Regulations

Minimum Energy Efficiency Standards (MEES) were introduced to encourage landlords to improve the energy efficiency of privately rented buildings. The standards apply to most commercial properties in England and Wales where an Energy Performance Certificate (EPC) is required.

Since 1 April 2018, landlords have generally been unable to grant a new lease of a property with an EPC rating below E. Since 1 April 2023, they have also generally been unable to continue letting properties below this rating.

The rules do not apply to every building or tenancy. Certain properties, including some listed buildings, and certain types of letting, such as some short-term tenancies and licences, may fall outside the scope of MEES.

There are also several exemptions and flexibility mechanisms, including where improvements fail the seven-year payback test, necessary third-party consent cannot be obtained, or improvements would reduce the property's value by more than 5%.

Some exemptions are temporary and must be registered on the PRS Exemptions Register. The rules are enforced by local authorities, which can impose significant financial penalties for non-compliance and publish details of breaches.

Proposed Changes

Under the proposed changes, privately rented commercial buildings over 1,000 m² would be required to achieve an EPC B rating from 2031. Buildings of 1,000 m² or less would remain subject to the current EPC E standard.

The Government has chosen to focus on larger buildings because they account for a significant share of energy consumption and offer greater potential for energy savings and emissions reductions across the commercial property sector.

Existing exemptions and flexibility mechanisms will remain in place, ensuring that landlords are only required to undertake practical, affordable and cost-effective improvements where these can be reasonably justified.

The legislation needed to implement these changes is expected to be introduced in 2027.

The Government estimates that the measures could save tenants around £360 million a year by 2031, while reducing demand on the UK's energy system, strengthening energy security and helping to cut carbon emissions.

Practical Implications

Landlords and tenants should start preparing now for the proposed changes, particularly those with larger commercial properties. While the 2031 deadline may seem some way off, planning retrofit works, securing funding and obtaining necessary approvals can take time.

Reaching EPC B could require investment in building services, lighting, insulation, heating and cooling systems. Works will also need to align with lease events, refurbishment cycles and wider net zero plans, while responding to growing tenant demand for energy-efficient buildings.

Final Thoughts

As landlords prepare for the changes, they should consider more than regulatory compliance, and look at how improving energy efficiency can support asset value, reduce operating costs and meet the growing expectations of occupiers.

There is still uncertainty around the final legislation and wider EPC reforms, but waiting for every detail may not be the best strategy. Understanding current energy use and identifying viable improvements now can help landlords make better-informed investment decisions.

Our Big Energy Group experts are able to provide specialist advice in this area. Please get in touch with us if we can be of assistance to you or your organisation.

About Big Energy Group

Big Energy Group is a privately held, British-owned energy brokerage with an established track record of helping clients successfully navigate the energy market. The company has offices in Harrogate and the Tees Valley and serves more than 500 businesses across the UK. For more information, please visit bigenergygroup.co.uk.